Which of the Following Statements About Current Liabilities Is True

question 80

Multiple Choice

Which of the following statements about current liabilities is true?

• A)Current liabilities are listed in order of decreasing amounts in the current liability section of a classified balance sheet.
• B)The amount of current liabilities has little implication for a company's liquidity.
• C)Current liabilities are the denominator in the formula for the current ratio.
• D)The current liabilities section of a classified balance sheet will never contain any portion of long-term liabilities.

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Definitions:

Revenue Centre

A segment, division, or unit of a business responsible for generating revenue, focusing on sales activities rather than profit or cost efficiencies.

Performance Measure

An assessment tool used to evaluate the effectiveness and efficiency of an individual's or organization's actions.

Standard Cost Variances

The differences between the estimated costs of production and the actual costs incurred.

Business Unit Reports

Financial or analytical documents that provide information on the performance of distinct divisions within a company.